DeFi Whitepaper – How Radix is Building the Future of DeFi

Radix DLT
13th August 2020

Ethereum 2.0, Polkadot, Avalanche, Near, Cosmos break DeFi! Our latest whitepaper explains how Radix fixes it and makes it scale. Read our latest DeFi whitepaper here

Radix is the first layer-1 protocol for Decentralized Finance, and today we’re excited to release our DeFi Whitepaper that explains what that means for Radix, and most importantly, the continued growth and mass adoption of the DeFi ecosystem.  

If you’re a dApp builder, DeFi user, or just someone who is ready to see DeFi go mainstream, this is something you don’t want to miss!

Today’s DeFi is Just the Warm-up Act

DeFi today is worth over $4 billion and growing (we even had to update this a few times while drafting this blog!). That’s a great start, but it’s a drop in the bucket compared to the $111.2 trillion of assets managed by the global financial system today. The grand vision of Decentralized Finance is that it finally offers a frictionless, transparent, democratic alternative to the rigid, closed services offered today by traditional banking.  Anybody using DeFi applications today – or building them – will tell you that it’s exciting, but far from ready for mass adoption. 

To get DeFi into the mainstream, there is some work to do. Mainstream DeFi needs:

Fast, low-cost transactions. Paying $30 for a DeFi transaction, getting into a gas war and waiting 10 minutes to find out if it went through doesn’t work for Mainstream DeFi.

Secure by design systems. The world needs better than just trusting money to an application written in Solidity and hoping that a programming language quirk doesn’t let millions of value get drained in an instant.

Scalable, composable applications. The magic of DeFi is in the superpower of DeFi applications working together like one huge program all on the same computer. The Ethereum 2.0, Polkadot, Cosmos, Ava Labs, Algorand and Near approach to sharding all break this superpower. So do all Layer 2 scalability solutions like Matic. Composability cannot be compromised for Mainstream DeFi to be successful!

Incentives for making an ecosystem more powerful. A healthy DeFi ecosystem isn’t just made up of large projects (especially not ones who are just paid to be there), but must involve the individual developer. At Radix we believe that it is the individual as much as the company that will bring DeFi into the mainstream, and so we built incentives for the individual developer right into our public network.

Ultimately, Mainstream DeFi will happen when all of the barriers holding back DeFi today are removed, without compromising decentralization. It happens when developers are finally given the tools they need to build apps that can surpass the services offered by the traditional financial industry. It happens when users of those apps wonder why they ever put up with the old way. Mainstream DeFi will move far beyond $4 billion and begins to absorb the $111 trillion waiting to be deployed onto the public ledger. Mainstream DeFi is the future we built Radix for.

Radix is the First Layer-1 Protocol for Mainstream DeFi

Creating a platform for Mainstream DeFi isn’t a matter of solving one problem; it’s a matter of solving multiple problems that exist at every layer of today’s DLT platforms. These platforms may deliver decentralization but were never designed to deliver no-compromises financial infrastructure. Putting a dent in one shortcoming might justify a nice ICO, but only puts a bandaid on the issue.

Mainstream DeFi needs a DLT platform designed bottom-to-top to make DeFi just work – for users, and for developers.

Radix is that platform.

The Radix platform is a combination of four core technologies that solve all four major barriers to DeFi growth, layer by layer:

Barriers to DeFi Growth DLT Platform Layers Radix Technologies
Scale Dapps without breaking DeFi composability Consensus/Network ← Cerberus
Avoid smart contract app hacks, exploits, and failures Development Environment ← Radix Engine
Build interoperable DeFi dApps faster DeFi “Lego Bricks” ← Component Catalog
Incentivize a decentralized development community Developer Ecosystem ← Developer Royalties


The result is a platform where transactions are fast, cheap, and secure; where scale is unlimited and connections between applications frictionless; where dApps can be built quickly and with confidence in their ability to manage user assets safely; and where builders are directly rewarded by the platform for useful contributions both large and small. It is a platform designed to serve as the foundation for Mainstream DeFi at global scale.

Each of the four Radix platform technologies represents a breakthrough that we’re excited to share with the world. 

The Radix DeFi Whitepaper that we released today goes into much more detail than this blog on each point and explains how each of the four Radix platform technologies work and how together they create the first truly layer-1 protocol for DeFi.

Are you a developer interested in developing on Radix? We’d love to let you know when early beta releases are ready, and keep you informed of our progression. If that sounds good to you, please sign up here:

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